The best Cash ISAs right now

As Santander pulls its market-leading ISA, we take a look at the best Cash ISAs on the market today and how they compare to the heights of ISA season.

Savers still have eight months left to take advantage of their tax free savings allowance on cash (currently £5,640) for 2012/2013. Sadly, many of the best Cash ISAs launched at the beginning of the year, in April, have been withdrawn. Indeed just last week Santander pulled its Cash ISA paying 3,3%, which was a market leader.

So if you have some money that needs a good home, which are the best new homes for your cash? Below I've put together a round-up of the best Cash ISAs paying more than 3% - so beating inflation - across a range of terms.

Best notice and instant access Cash ISAs

ISA	Interest rate AER	Minimum deposit	Transfers in?	Term/Notice
Coventry BS 60 Day Notice ISA	3.25% (includes a 0.50% bonus for 12 months)	£1	No	60 days notice
West Brom BS WebBSave ISA 6	3.18% (includes 1.66% bonus to 30.09.13)	£1,000	Yes	60 days notice
Aldermore 60 Day Notice Cash ISA Issue 1	3.15% (includes a bonus of 1.65% until 01.03.13)	£1,000	Yes	60 days notice
Manchester BS Platinum Instant ISA Issue 1	3.06% (includes a bonus of 1.05% for 12 months)	£1,000	Yes	Instant access
Barclays Cash ISA Loyalty Reward ISA*	3.05% (includes a bonus of 1.0% for 12 months)	£1	No	Instant access
Post Office Premier Cash ISA	3.01% (includes a bonus of 1.26% for 18 months)	£100	Yes	Instant access
ING Direct Cash ISA	3.00% (rate guaranteed for 12 months)	£1	No	Instant access
Marks & Spencer Advantage Cash ISA	3.00%	£100	Yes	Instant access
Santander Direct ISA Issue 10	3.00% (includes a bonus of 2.50% for 12 months)	£500	Yes	Instant access

*Only available to existing customers

Best one-year fixed rate Cash ISAs

ISA	Interest rate AER	Minimum deposit	Transfers in?	Term/Notice
Julian Hodge Bank Fixed Rate Cash ISA	3.35%	£100	Yes	One-year bond
Aldermore Fixed Rate Cash ISA	3.30%	£1,000	Yes	One-year bond
Metro Bank One-Year Fixed Rate Cash ISA (2)	3.25%	£1	Yes	One-year bond
Santander One-Year Fixed Rate ISA	3.20%	£500	Yes	Fixed until 01.09.13
Progressive BS Ltd Issue Postal One-Year Fixed Rate ISA Bond 2	3.15%	£500	Yes	One-year bond
Marks & Spencer Cash ISA	3.10%	£500	Yes	One-year bond
Kent Reliance BS Flexible Fixed Rate ISA One -Year Issue 5	3.10%	£1,000	Yes	One-year bond
Post Office Fixed Rate Cash ISA Issue 7	3.10%	£500	Yes	One-year bond
Saga* One-Year Fixed Rate ISA	3.00%	£1	Yes	One-year bond
Virgin Fixed Rate Cash E-ISA Issue 15	3.00%	£1	Yes	One-year bond

* Only available to over 50s

Best 18-month and two-year Cash ISAs

ISA	Interest rate AER	Minimum deposit	Transfers in?	Term/Notice
Santander Two-Year Fixed Rate Major ISA	4.00% (up to 4.1% if Rory McIlroy wins a Major)	£1	Yes	Two-year bond
Post Office Two-Year Fixed Rate Cash ISA	3.60%	£500	Yes	Two-year bond
Principality Building Society (18 month fixed rate)	3.33%	£500	Yes	18-month fixed bond
BM Savings Two-Year Fixed Rate ISA (yearly interest)	3.30%	£500	Yes	Two-year bond
Marks & Spencer Cash ISA	3.25%	£500	Yes	Two-year bond
Halifax ISA Saver Fixed	3.25%	£500	Yes	Two-year bond
Nottingham BS Fixed Rate ISA Issue 8	3.20%	£500	Yes	Fixed until 31.10.2014

Best three-year Cash ISAs

ISA	Interest rate AER	Minimum deposit	Transfers in?	Term/Notice
Post Office Fixed Rate Cash ISA	3.70%	£500	Yes	Three-year bond
Saga Fixed Rate ISA*	3.70%	£1	Yes	Three-year bond
Marks & Spencer Fixed Rate Cash ISA	3.50%	£500	Yes	Three-year bond
Halifax ISA Saver Fixed	3.50%	£500	Yes	Three-year bond
Virgin Fixed Rate Cash E-ISA Issue 18	3.30%	£1	Yes	Fixed until 24.08.15

* Only available to over 50s

Best four- and five-year Cash ISAs

ISA	Interest rate AER	Minimum deposit	Transfers in?	Term/Notice
Halifax Five-Year ISA Saver Fixed	4.15%	£500	Yes	Five-year bond
Halifax Four-Year ISA Saver Fixed	4.10%	£500	Yes	Four-year bond
BM Savings Five-Year Fixed Rate ISA (yearly interest)	4.05%	£500	Yes	Five-year bond

Plummeting rates

Compared to four months ago, when the new tax year began and providers launched brand new ISAs, the rates on offer today are paltry.

Rates tend to hit their peak during ISA season as we get towards the end of the tax year. That's when providers are at their most competitive, as the new tax year sees a new ISA allowance. But rates fall, sometimes substantially, as the year goes on.

As well as rates being reduced, there are also fewer ISAs available. You can see how the table leaders have changed using our round-up from April 2012 in The best Cash ISAs for the new tax year 2012/13.

For example, the best rate instant access savings in April was 4.25% for Nationwide customers or an AA account that paid 3.5%. The best rate I could find on offer today pays just 3.06% from Machester BS.

This just goes to show how important it is to take advantage of ISAs as soon as you can. Later in the year fewer competitive accounts are likely to be around.

It's not too late though. Starting an ISA now instead of waiting for the deadline in April 2013 means you will at least have a healthier pot in time for next year. Plus, saving as early as possible in the tax year means you have more chance of taking advantage of the full allowance as well.

This article has been updated since it was first published

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